There`s news tonight that some on the American right are plotting the
global explosion of a default on the U.S. national debt this fall. The
plot is to tie the regular vote to extend the debt ceiling to the
obliteration of the Affordable Care Act.

According to the plans leaked to right-leaning news organizations, any
measure to finance the health care act would detonate a refusal to make
good on American debt, the first time this has happened in this country`s
history, and the repercussions of which could explode the world economic
order.

Well, do the leaders of the Republican Party really intend to go this far?
Do they really dare to sabotage the American economy and much of the world
economy in order to defund a program, the Affordable Care Act, that is the
law of the land? And will they go to this drastic extreme to intimidate
the U.S. Congress or the president or both?

And if so, is this the extreme case where ideological zealotry trumps even
the most minimal loyalty to the common national interest, where anything
goes, where the ends justify whatever means there are to be had, no matter
how menacing to the country or the world?

John Feehery is a Republican strategist. Alex Wagner is the host of "NOW"
weekdays at noon Eastern, MSNBC.

Alex, we`ve got a number of news sources out tonight. One of them, of
course, is "The National Review," which is a conservative organization, not
a right-wing one, and "The Washington Examiner," which is a bit to the
right of that, with new sourced stories saying the people on the Republican
right are actually planning to step back from a government shutdown in
September, but to proceed to an escalation of this fight to basically
defaulting on the national debt.

That would be their threat. If the Congress moved to fund the Affordable
Care Act, which is the law of the land, they would cut off, if they could,
any vote to extend the national debt, and therefore, of course, default.

What do you think of this?

ALEX WAGNER, HOST, MSNBC "NOW": Bad to worse, Chris. I don`t know. I
mean, if you thought -- if you thought that, you know, holding the debt
ceiling hostage was a bad -- if you thought a continuing resolution holding
that hostage was a bad idea, you`ll hate this one.

Republican elders came out very reasonably and said, We cannot hold the
country hostage, we cannot hold the budget hostage on defunding "Obama
care." It`s never going to work. I mean, the debt ceiling is an even
worse idea. But as "The National Review" has reported, you know, House
leadership is engaged in political wink-wink kabuki theater, where they
effectively have to entertain every single harebrained idea that the right
flank has, to placate them.

The question is, at the end of the day, can they bring them back from the
brink? You know, I think over the Bush tax cuts and plan B, we saw John
Boehner completely fail there. His power -- his grasp on the most rowdy
members of his own caucus seems to be loosening.

You would think, based on reason alone, that something would bring them
back from the precipice, but I think the country, political watchers, you
and I get, Chris, we get less and less convinced by the day that anybody`s
in charge here and that anybody has their hands on the captain`s wheel.

MATTHEWS: Well, you`re nice to call it rowdy. Let me give John a thought
here about what we`re talking about here. Support for a government
shutdown is evaporating, as I said. Over the weekend, Tea Party hero Rand
Paul, in fact, stated it plainly. Shutdown is a bad idea, he said. We`ll
take a listen to him.

(BEGIN VIDEO CLIP)

SEN. RAND PAUL (R), KENTUCKY: Well, I don`t think shutting down the
government is a good idea, but I do think that we were elected,
conservatives were elected to try to stop this overreach, this government
takeover of health care.

When the government`s divided, we should use the leverage of controlling at
least part of government to try to get the law more to our liking.

MATTHEWS: Well, if that strikes you as reasonable, and it does at that
point, there are several reports the Republicans are looking to drop the
threat of a government shutdown this September if the Affordable Care Act
isn`t dismantled. Instead, they`re looking at an approach which would
result in something far worse, something like economic Armageddon.

And one of those reports comes from Robert Costa in "The National Review,"
as I said, who writes, quote, "Sources tell me the House GOP will probably
avoid using a shutdown as leverage and instead use the debt limit and
sequester fights as areas for potential legislative trades. Negotiations
over increasing the debt limit have frequently been used to wring
concessions out of the administration, so there may be movement in that
direction, delay `Obama care` in exchange for increased debt limit."

Well, when HARDBALL asked -- when we were asked by (sic) HARDBALL about
these reports (INAUDIBLE) strategy to use the debt sealing limit to fight
the Affordable Care -- a spokesman from House Speaker John Boehner`s office
said, "No decisions have been made. But we`re looking at all the options
to reach our ultimate goal of repealing this law that is causing premiums
to soar and full-time jobs to disappear."

Of course, we`ve got other sources. We`ll go to them later. Of course,
"The National Review" is one source we`ve mentioned. "The Washington
Examiner" points to the same.

John Feehery, so for a while there, we thought over the weekend, sanity was
coming to your party and even from the far right, from the libertarian
right. And now we find out that their new strategy is, in fact, an
escalation. They`re talking about using the debt ceiling, which means you
go into default if you don`t extend.

Is this reasonable politics or is it extreme politics?

JOHN FEEHERY, REPUBLICAN STRATEGIST: Well, what I would expect John
Boehner to say, which he always says in these circumstances, We will not
default on our debt. We will not default on our debt. I don`t think that
--

MATTHEWS: Did he say that?

FEEHERY: He always says that.

MATTHEWS: But he didn`t. He said, We`re looking at all options, including
default.

FEEHERY: We`re not going to default on our debt. And I guarantee you that
John Boehner --

MATTHEWS: OK, explain to me what the right is up to here, if they`re not
in the game of sabotage.

FEEHERY: I think what the right wants to do is to get as -- hobble as much
as possible a very unpopular law, which is "Obama care." They`re worried
about these subsidies going into effect because they know that if this
happens, we`ll have fiscal meltdown in this country in a long term, and I
think they`re worried about that. And so they`re trying to find a way to
pick at this very unpopular law. And I think they`re going to use all of
the negotiating tactics they can.

The interesting thing about Robert Costa`s explanation was sequestration.
And this is the give and take here that I think we can find some sort of
bigger deal on the budget deficit, on the continuing resolution --

(CROSSTALK)

MATTHEWS: You`re missing my point.

FEEHERY: (INAUDIBLE)

MATTHEWS: Is there a threat here from people like Rand Paul and Ted Cruz
and Mike Lee of Utah, from the right of your party -- not the center of
your party, but the hard right -- that basically plays such hardball that
they`re willing to face default or threaten default on the United States
dollar, basically, in order to get their way to kill the law of the land,
which is the Affordable Care Act?

FEEHERY: No, they`re not going to default. They`re --

MATTHEWS: Then why are we -- what are all these reports about?

FEEHERY: They`re not going to push -- what they`re going to try to do is
push the fight from government shutdown, which they understood was not a
good fight to have, to a bigger fight on the bigger fiscal realities facing
the country. So they --

MATTHEWS: Alex, this isn`t just "The National Review," it`s "The
Washington Examiner." Let me quote from "The Washington Examiner." "The
plan is to pass a 60-day CR extension" -- that`s continuing resolution --
"that keeps discretionary spending at the existing sequestration levels.
Then House leadership wants to combine Democratic desires to roll back
sequestration with conservative desires to delay, defund Obamacare into the
debt limit fight."

It`s -- they`re leaking this story. They`re threatening it through
sourcing of this. You know how it`s done. They`re putting the word out
without any fingerprints on it to get the threat out there that they`re
willing to bring down -- not just bring down the government, bring down the
dollar.

WAGNER: Can we just focus for a moment on how completely absurd this is?
It is literally like yelling, you`re not going to -- you`re not going to do
your fiscal -- you`re not going to keep the government running unless we
establish a colony on Mars.

Like, Obamacare is settled law of the land. It is happening. The notion
that somehow, the White House is going to do deal-making on settled law on
the land, which was recently upheld by the Supreme Court and litigated in
the 2012 presidential race, and we know how that all turned out, is
ludicrous.

The idea that somehow, there`s going to be a deal made on sequestration,
when half of the far-right flank thinks that sequestration has actually
been a great thing, is also crazy. I just don`t see where the bargaining
happens here.

FEEHERY: Well, there`s going to be a bargain. There has to be some sort
of budget deal. We know that we got to figure out the fiscal situation on
a continuing resolution. We know we have to figure out entitlements. We
know at some point in time -- you have Max Baucus and Dave Camp worrying
about -- running around trying to get tax reform.

WAGNER: But --

FEEHERY: We need to fix this government. And I think that at the end of
the day, when you have this debt limit fight, which there will be a fight,
you know -- and you know this, Chris. You were in the House of
Representatives. You know how hard it is to pass any debt limit extension
in the House of Representatives.

I think that for John Boehner, he`s got to find a way to cobble together
the votes, and that requires a bigger deal. And there`s going to be a
bigger deal. That being said, there will not be a default on the debt.

MATTHEWS: -- of sabotage mean here? When you say, I`m threatening not
just to shut down the U.S. government but I`m threatening to screw the
American economy and the world economy, what does that mean? You say it`s
a bluff, basically, is what you`re saying.

FEEHERY: No, I`m saying they`re not going to do that. I think --

MATTHEWS: Well, if --

(CROSSTALK)

FEEHERY: I think there will be some short-term extensions of the debt -- I
think we`ll go back to the Boehner rule, which is we`re going to cut a
dollar for --

WAGNER: But --

MATTHEWS: So when the president looks into the eyes of Republican leaders
who are reasonable people, like Boehner, is he to believe that they`re
bluffing and or they`re telling the truth when they say, We`re going to
light the fuse for the end of this economy?

FEEHERY: I think what -- I think that Republican leaders will say, and
they`ll say very consistently, is, We are not going to default on our debt.

WAGNER: John, what leverage do you think Republicans have? If they end up
going -- taking the nuclear option and shutting down the government, or you
know, hijacking the American economy, everybody`s going to blame them. I
don`t understand what cards the GOP has to play in this.

FEEHERY: Well, I think --

MATTHEWS: Well, let`s go to -- let`s go to that very point. Let`s look at
some polling data because I`m not sure I agree with you, Alex, across the
board. The American people generally will blame the Republicans. Who gets
the blame (INAUDIBLE) debt ceiling is (INAUDIBLE) Good question. According
to an NBC/"Wall Street Journal" poll taken earlier this year, more
Americans, 45 percent -- just more Americans, not all of them -- would
blame Republicans than blame Democrats. Just 33 percent would blame the
Democrats.

But an overwhelming majority of Democrats, no surprise, 80 percent, 4 out
of 5, would blame the Republicans. But only 9 percent of Republicans would
blame their own party. A majority of Republicans, 66 percent, would blame
President Obama and the Democrats.

So I`m pointing to you the obvious political game being played here by your
side. If the United States reaches a breach in its debt ceiling, it
doesn`t pay its debts, your own party won`t blame your own party!

FEEHERY: They`ll blame Obama.

MATTHEWS: So there is a reason why they could be serious here!

FEEHERY: They will blame Obama and --

MATTHEWS: Well, then -- how are you so sure they won`t pull the trigger on
this?

FEEHERY: Well, because I`ve been through about 18 of these debt limit
fights, and --

MATTHEWS: Let`s take a look now at what will happen. Let`s (INAUDIBLE) we
have a list here of what will happen if the debt ceiling is breached right
now. A spike -- this is a reminder of what would happen. Treasury markets
would spike, resulting in a dramatic increase in credit card rates and
mortgage rates. Numerous government services would be crippled, important
government services like the prison system, the FBI, and including the
federal courts themselves. For financial markets, it would precipitate
global chaos. And ironically, it would lead to an increase in future
deficits, thanks to the economic shock.

So you`re sitting in China somewhere, in Beijing, and you`re in a central
bank over there, and you learn that the United States political screwing
around by something called the right wing -- they`re not sure what it is
over there -- has brought down the ability of the United States to meet
debts.

FEEHERY: I predict that --

MATTHEWS: What do you think over there?

(CROSSTALK)

FEEHERY: -- John Boehner will say, We`re not going to default on our
debt. And I think that Republicans --

WAGNER: -- you know what -- you know, what has happened here, the only
sort of skillful thing the Republicans have done is to have drawn the White
House and Democrats into what is an internecine GOP war.

This is the story of the modern-day Republican Party. This is the harvest
that is wrought when you invite incredibly extremely irresponsible -- I
wouldn`t even call them conservatives -- Tea Partiers --

MATTHEWS: No, they`re not.

WAGNER: -- into your House.

MATTHEWS: They`re not conservatives.

WAGNER: This is not a -- this is not a Democratic and Republican debate
here. This is a battle among Republicans.

FEEHERY: And if you ask any Republican leader, which I just asked three
Republican leaders" offices today --

MATTHEWS: Well, on the record, they won`t say it. But off the record
here, they`re leaking the story they`re going to blow it up.

FEEHERY: Default is not an option. It`s not going to happen.

(CROSSTALK)

MATTHEWS: -- John Feehery, I hope you get picked upon the wires. John
Feehery, former spokesman for the House leadership when they were
reasonable, says default is not an option. Thank you, Alex Wagner, a pro
at this discussion.

Coming up: Ted Cruz -- we know that he was born in Canada, of course, but
we know he`s renouncing his Canadian citizenship, which had (ph) nothing to
with (ph), of course, just (ph) they threw it at him. He`s thinking about
2016. And my question -- where are all the birthers out there who`ve been
insisting that you can`t be president if you`re born -- unless you`re born
here in the United States?

By the way, the craziest of the birthers, Donald Trump, said he was born in
Kenya. But even if he was born in Kenya by an American mother, he`d be
just as American and just as liable to -- able to run for president as Ted
Cruz. Mr. Trump, would you explain the conundrum here?

Also, the latest U.N. report says to -- lays to rest the lingering doubts -
- I don`t know where (ph) they were -- about climate change. So why are
the global warming deniers still at it? What`s in it for them? They keep
denying what`s obvious to the scientists.

And the Republican governor of Maine is being quoted as saying -- we`re
going to keep checking this one out, but he`s been quoted as saying Obama
hates white people. A couple serious sources, lawmakers, heard him say it.
You mean he doesn`t like his mother? What`s going on here?

Finally, safety versus privacy. Are all the cameras watching us out there
doing us a good thing? Britain has hundreds of thousands of cameras
watching everybody in the streets of London. We`re going to talk to a guy
involved in a movie about that, right out of George Orwell.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Well, some hot political news. We just got a look at the New
Jersey special election for the U.S. Senate. And for that, we check the
HARDBALL "Scoreboard."

According to a new Monmouth University/"Asbury Park Press" poll, Democrat
Cory Booker, no surprise, has a 16-point lead over Republican Steve
Lonegan. It`s Booker 54, Lonegan 38 in that special election to fill out
the term of the late and great Senator Frank Lautenberg. And this special
election is coming up on Wednesday, October 16th.

JONATHAN KARL, ABC NEWS: You were born in Canada. Could you -- are you
even eligible to be president of the United States?

SEN. TED CRUZ (R), TEXAS: My mother was born in Wilmington, Delaware. She
is a U.S. citizen, so I`m a U.S. citizen by birth.

(END VIDEO CLIP)

MATTHEWS: I`m a U.S. citizen by birth, and he couldn`t be more right.

Welcome back to HARDBALL.

That was Texas senator Ted Cruz telling ABC`s Jonathan Karl that he is, in
fact, a natural-born citizen, therefore eligible to be president.

Cruz went the extra mile to release his birth certificate to "The Dallas
Morning News," which reported that Cruz, who was born in Canada to an
American mother, has dual citizenship, which is, by the way, the accident
of being born up there.

And following that report, Senator Cruz released a statement renouncing his
Canadian citizenship formally. He said "Now `The Dallas Morning News` says
that I may technically have dual citizenship. Assuming that to be true,
then sure, I will renounce any Canadian citizen -- nothing against Canada,
but I`m an American by birth, and as a U.S. senator. I believe I should
only be an American."

Well said. I couldn`t agree with him more. It`s odd for me to say this
about a guy I probably disagree with on many points, but he couldn`t be
more right.

The irony here, of course, is that Cruz`s birth mirrors the phony scenario
concocted by the birthers, including Donald Trump, who falsely have been
arguing even to this day that President Obama was born overseas, mostly in
Kenya, and not eligible to be president. The president, of course, was
born to an American mother in the state of Hawaii. That was actually in
America, by the way.

But the birthers have been all but silent when it comes to Ted Cruz. I`m
waiting for some competent statements from these people now. Cruz has
already visited the important presidential primary states of Iowa and South
Carolina, and he`s headed to New Hampshire this month.

He`s giving every indication he may be thinking of running for president
and is eligible to do so. He`s a natural-born citizen because he did not
have to be naturalized. That`s how simple it is. He was an American at
the second of his birth.

Well, joining me to discuss this are Texas political expert and "Dallas
Morning News" political writer Wayne Slater and MSNBC political analyst and
"Washington Post" editorial writer Jonathan Capehart.

Wayne, I couldn`t be more clear in my complete and utter agreement with
Senator Cruz. He`s an American by birth. His mother was American. I
don`t care if you were flying in an airplane over Toledo, or Toledo
somewhere in Spain, if you`re born to an American mother, you`re an
American, damn it, and he`s honestly -- because you don`t have to get
naturalized. That`s what a natural-born American means here. You don`t
have to apply for citizenship, you are a citizenship (sic) natural born.

Don`t the crazy birthers down in that state of Texas, which you have to
report from -- the cross you must carry is defending some of these guys --
all that handful of birthers down there, which is the heart of birtherdom -
- don`t they get the crazy irony that they`ve been accusing Obama of being
born to an American mother over in Kenya, when even in that weird case,
which wasn`t the truth, would still make him a natural-born American?

WAYNE SLATER, COLUMNIST, "THE DALLAS MORNING NEWS": Yes.

I mean, the real problem for the birthers is that Ted Cruz really was born
in a foreign country.

JONATHAN CAPEHART, MSNBC CONTRIBUTOR: Yes.

SLATER: And so, based on that argument, it really is a real -- really a
real problem.

MATTHEWS: But don`t they get in their head, wait a minute, we have been
accusing Obama of doing what this guy did and we accept his natural-born
American-ness, and we have accused Obama, by nature of being born in this -
- fictitious notion of being born in Kenya, of proof he isn`t a natural-
born American?

And you know why as well as anyone else who`s watched this closely. It`s
because this never really was about Obama being born somewhere. This was
just, say something bad about Obama.

MATTHEWS: Yes, I know. So`s you`re old man.

SLATER: The black guy in the White House who must be from somewhere else.

(CROSSTALK)

SLATER: Now they find themselves, especially the folks in Texas, who I
suspect will like to endorse Ted Cruz if he becomes a serious presidential
candidate, now they find themselves in this conundrum where they can`t or
will have real difficulty gymnastically working their way around this.

MATTHEWS: Yes. I know.

SLATER: Why is he eligible? It`s a problem.

MATTHEWS: I`m going to stick about that and not about the ethnic thing,
because the ethnic thing is pretty obvious in some cases -- in some cases.

But, Jon, I guess I would think that in the African-American community,
anybody who is watching right now in that community, would probably say,
it`s obvious to me they look upon Canada as a white country and Kenya as a
black country, and even though it`s your mother who was white in both
cases, it`s somehow different.

CAPEHART: They don`t handle it at all. They don`t handle it at all. They
don`t talk about it.

(CROSSTALK)

MATTHEWS: Well, how about Donald Trump? Smart guy, makes money.

CAPEHART: Well, I think Donald Trump --

MATTHEWS: How does he deal with this?

CAPEHART: I think Donald Trump sort of --

(CROSSTALK)

MATTHEWS: Well, here he is, here he is, here he is. Even Donald Trump --
I love to talk about him. He`s a popular guy in some quarters, king of the
birthers, I must say -- is a bit muddled about Cruz`s eligibility to be
president.

And if you have trouble following this point of view, it`s probably because
Trump doesn`t want you to follow it. It`s like Eisenhower used to do, to
mix up the syntax a bit so you don`t know what he`s saying. Let`s listen.

CAPEHART: But it`s still happening there, people going to town hall
meetings around the country and saying --

(CROSSTALK)

MATTHEWS: Wayne, let`s get to where the -- because Jonathan and I, I
think, may agree on this. I`m not sure. I will find out in a second.

I want to get to you on this from Texas. It seems to me there`s a very
interesting, compelling continuing effort to delegitimize this president.
Of course, people on the right say he`s a disaster. They love to make that
case, which he`s clearly not, historically. Look what he`s already
accomplished in terms of health care and other issues and getting the bad
guys and stuff like that.

But they first of all refer to him not as the president of the United
States, but as a liberal leader. They refer to the health care act of 2010
as a bill. They refer to him as Obama. They don`t say the president.
They don`t say a law. They don`t even speak the language we normally speak
in civilized political debate.

They have changed it so much that he`s actually not really supposed to be
there. And that`s their way of putting that asterisk next to him, like
Barry Bonds. He didn`t really hit the home runs. He really didn`t get
elected president.

I think that`s what they`re up to.

SLATER: I really do.

MATTHEWS: And I`m not paranoid.

SLATER: I think that -- I think that`s right. No, I do think that`s
right.

And I think there is a sense in everything that`s done, not only the normal
political give and take where you challenge your opponent`s bills,
proposals, ideas, and initiatives, but the idea that the person himself was
never supposed to be there, he was never supposed to be reelected. And so
now if they just wait it out, then the guy who was never supposed to have
been there, whose signature accomplishment, health care, should be
defunded, if for no other reason because he did it and it has his name
associated with it, then --

MATTHEWS: Yes. Yes. Get him off the record books. Get him out. Erase
him. Erase him in your mind.

(CROSSTALK)

CAPEHART: But, Chris, you know how they -- how the birther conversation is
morphing into an impeachment conversation. They don`t just want to wipe
him off the books. They want to just get him completely out of office,
accusing him of committing a felony by forging --

MATTHEWS: What`s that?

CAPEHART: By forging his birth certificate.

MATTHEWS: Oh, that, yes.

CAPEHART: He`s there. He`s there in office illegally.

And at two -- at one town hall forum, Congressman Farenthold was asked,
what can be done about this? And he just willingly talked about, well, you
know, impeachment is not really an option because we don`t have the votes
in the Senate. We could convict him in the House. We could bring up the
charges in the House, impeachment in the House, but we couldn`t convict him
in the Senate.

And Senator Ted Cruz is on record as having -- not talking about the
birther issue, but talking about impeachment and also taking that line of,
you know, you could impeach him in the House, but we couldn`t -- we
couldn`t get him in the Senate, we couldn`t convict him in the Senate. So
it`s not really a possibility, but it`s a question.

Up next: Meet Sunny, the first family`s newest addition. It`s not a
person.

And a very important programming tonight. Starting this coming Monday, you
can catch HARDBALL exclusively and only at 7:00 Eastern.

And for those of you who watch us at 5:00 Eastern, starting next week, you
will have to tune in at 7:00. And don`t worry. I will keep reminding you
about this all week long. I want you to change with me, move with me to
7:00 Eastern. I know how important this time of night is. It`s sort of
when we slow down. It`s when I speed up.

And this is HARDBALL, the place for politics.

(COMMERCIAL BREAK)

MATTHEWS: Back to HARDBALL and time for the "Sideshow."

President Obama is back in Washington, of course, after taking a week off
in Martha`s Vineyard. And "The Late Show"`s David Letterman commemorated
his presidential vacation with this video last night.

(BEGIN VIDEO CLIP, "LATE SHOW WITH DAVID LETTERMAN")

DAVID LETTERMAN, HOST, "LATE SHOW WITH DAVID LETTERMAN": Let`s put
together a segment about memorable presidential vacations. And, by God, we
have it for you tonight, memorable presidential vacations throughout the
years. I hope you enjoy this.

MATTHEWS: Well, the president also introduced the newest member of his
family, another Portuguese water dog named Sunny -- there he is -- who has
joined Bo -- another Portuguese water dog -- at the White House.

Almost every president has had a pet, of course, but here`s some trivia for
you. There`s only been one first dog who has lived in the White House
under two different presidents, Spotty, a King Charles, who was born in
1989 under President George Bush 41, and then had the good fortune to
return again with George W. Bush when he became president in 2001, so two
presidents for that dog.

However, the most famous by far of all the dogs at the White House is Fala,
of course. We love Fala. Franklin Roosevelt`s Scottish terrier became
such a household name that MGM, the movie company, even made a movie about
him called "Fala at Hyde Park," and it was in Technicolor.

Fala is also the only first dog to be honored with a statue in a
presidential memorial down in Washington. It`s over near the Tidal Basin.
I love going over there. And that`s something for Sunny of course to
aspire to. Look at that big dog.

Next up: Maine`s Republican Governor Paul LePage is in hot water today for
allegedly claiming in a speech at a private fund-raiser, where else, that
President Obama -- quote -- "hates white people" -- close quote.

While the event was closed to the press, word of the remark leaked to "The
Portland Press Herald" newspaper, which confirmed it with two other
Republican lawmakers who were present at the time. According to "The
Herald" -- quote -- "LePage talked how Obama could have been the best
president ever if he had highlighted his biracial heritage. LePage said
the president hasn`t done than because he hates white people."

LePage is up for reelection in 2014 and has a 39 percent approval rating,
which makes him one of the most unpopular governors in the U.S. He has
since denied he made the remark. Well, we will find out whether he did or
not. Apparently, there are a number of reputable witnesses who said he did
exactly that.

More evidence, by the way, that the planet is getting warmer right now,
global warming is here, and we are responsible, so why are so many
Republicans in denial?

The Dow down seven points, posting its fifth day of losses, but the S&P 500
gained six, and the Nasdaq rallied 24 points. Home Depot`s profits jumped
17 percent in the second quarter, thanks to an improving housing market.
Bargain airline Allegiant announced a major expansion, added 18 routes in
10 cities, including New York City. And Samsung`s new smartphone, the
Galaxy Mega, will go sale Friday through AT&T.

That`s it from CNBC. We`re first in business worldwide -- now back to
Chris at HARDBALL.

MATTHEWS: Welcome back to HARDBALL.

Those science deniers over at the GOP are getting served with another raft
of scientific evidence that climate change is real and a big problem for
everyone. An upcoming United Nations report outlined in New York -- in
"The New York Times" will show -- quote -- "Scientists who were confident
before have even more confidence that climate change is real, it`s due to
us, it`s a threat to us, and the urgency to act is even greater than ever."

Now enter the Republican Party, where proven science is merely one of the
few -- well, one of a few theories.

(BEGIN VIDEO CLIP)

REP. PAUL BROUN (R), GEORGIA: Scientists all over this world say that the
idea of human-induced global climate change is one of the greatest hoaxes
perpetrated out of the scientific community. It is a hoax. There is no
scientific consensus.

REP. MICHELE BACHMANN (R), MINNESOTA: Carbon dioxide, Mr. Speaker, is a
natural byproduct of nature. Carbon dioxide is natural. It occurs in
Earth. It is a part of the regular life cycle of Earth. In fact, life on
planet Earth can`t even exist without carbon dioxide.

GEORGE STEPHANOPOULOS, ABC NEWS: What is the Republican plan to deal with
carbon emissions, which every major scientific organization has said is
contributing to climate change?

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: George, the idea that
carbon dioxide is a carcinogen that is harmful to our environment is almost
comical. Every time we exhale, we exhale carbon dioxide. Every cow in the
world, you know, when they do what they do, you have got more carbon
dioxide.

(END VIDEO CLIP)

MATTHEWS: I don`t know what he`s talking about. Nobody ever -- talk about
a straw man. There you have Boehner, the speaker of the House, coming out
with something wacko when he talked to George Stephanopoulos, saying it
isn`t causing cancer.

Anyway, Oklahoma Senator James Inhofe, the worst of the brood here -- the
breed here -- has written a whole book denying science, subtly called "The
Greatest Hoax: How the Global Warming Conspiracy Threatens Your Future."

The problem is, these science deniers help govern the United States. They
have the job to tell us the truth.

And joining me right now is Chip Saltsman, Republican strategist who was
Mike Huckabee`s campaign manager in the 2008 presidential race, and Michael
Mann. He`s professor of meteorology at Penn State. He`s author of "The
Hockey Stick and the Climate Wars: Dispatches From the Front Lines."

Professor, are you available? Did you get your sound on there?

MICHAEL MANN, PROFESSOR OF METEOROLOGY, PENN STATE UNIVERSITY: I think we
have got it.

You know, I -- my sense is that climate change and evolution are like
gravity. They`re a fact. Drop a quarter, it falls. It`s a fact. And
don`t argue about it. It`s not one of the many theories out there. It is
a scientific reality, and that if somebody has some other standard besides
science, I want to hear what it is, business practices, religion. Tell me
you have some other way of judging something besides the scientific method.

As a scientist, is there any doubt that climate change is a problem and
it`s caused by man?

MANN: Well, there are few things in science that we`re as certain about as
the fact that we are warming the planet by increasing greenhouse gas
concentrations through fossil fuel burning and other human activities.

You know, maybe gravity, maybe there are a few other propositions in
science that we have as high a level of certainty about as we have about
this issue of human-caused climate change.

MATTHEWS: So what, from your perspective, is the motive for questioning
the science?

MANN: Well, unfortunately, the various talking points, and we heard some
of them in the clips that you played from climate change deniers, often
sound plausible, they sound reasonable to people who aren`t familiar with
science or the underlying science of climate change, but they have a very
thin veneer of credibility.

When you dig just a little bit beneath them you find out that there`s no
merit at all to these various myths, these various talking points. So who
are you going to listen to, politicians who are advocating for fossil fuel
interests or the world`s scientific community, the U.S. National Academy of
Sciences, founded, by the way, by a Republican president, Abraham Lincoln,
which is firmly on record.

Global warming is real. It`s caused by us. And it represents a serious
threat if we don`t do something about it.

MATTHEWS: Chip Saltsman, looking at this politically from a Republican
side, what is the argument that outweighs, well, accepted science?

CHIP SALTSMAN, REPUBLICAN STRATEGIST: Well, you know, I`m not a scientist.
And I don`t play one on TV, so I will definitely --

(CROSSTALK)

MATTHEWS: I know you aren`t. But I`m asking you, what`s the other
standard we should look at besides science when we look at -- looking for
something whether it`s true or not? Is there some other way to judge it
besides the science? And if there is, let me know what it is.

SALTSMAN: Yes, I think the Republicans that I`ve talked to about this,
when they talk about global warming they say, look, we know that we`ve got
7 billion people on this planet using more resources than we did 100 years
ago, 50 years ago. We know that we`ve got to make changes if we`re going
to sustain that.

And I think there`s a lot of Republicans out there that do believe in
renewable energies and all that kind of stuff. They just don`t buy into
the total package that we`re going into an apocalyptic point of view that
global warming is going to destroy the Earth as we know it. I think that`s
what`s in the talking points you heard earlier.

MATTHEWS: So they`re taking a gamble -- they`re making a gamble that it`s
not -- they think there`s a decent stake in not acting.

SALTSMAN: Well, I think some of them are acting. I think there`s a lot of
conservationists among the Republican Party --

MATTHEWS: No, but -- no, the people you say that it`s not Armageddon. OK,
it`s not apocalyptic. What basis do they have for saying that? What
scientific knowledge do they have that they present against the scientific
community and the world to make a case that it`s not as serious as the
scientists say it is? What evidence do they have to say that?

SALTSMAN: I`m not sure that I know of the evidence that they`re talking
about because I don`t know --

MATTHEWS: But what is their foundation? I`m asking from a political point
of view. What`s their political foundation to challenge the science? Is
it religion? Is it the Old Testament? Is it commerce? What is it?

SALTSMAN: I think some of it is all of the above. I think some of it is
the economy. When you talk about cap and trade, they think that would
wreck the economy as we know it. They don`t want to do that.

I think some of it is religious. The idea that manmade can destroy the
world, I think that`s something they think that God does, not what man
does. So I think there`s some of that all the above, whether you agree
with it or not, that`s what they say.

MATTHEWS: Yes, but we had a potential nuclear war between us and the
Soviets in the 1950s and `60s and into the end of the `80s that I knew and
you knew, Chip, could have destroyed the world. So let`s not deny the
potential of man to destroy the world.

Professor, it seems to me that there is an anti-science bent out there.
It`s fostered by the argument, maybe the Old Testament that says mankind
has only lasted as long as the begats added up, begat this, starting with
Adam and Eve all the way through the Old Testament into the New Testament.

And yet, there`s evidence -- scientific evidence that mankind in some form
or another has been on this planet for over 3 million years going back to
at least Lucy. So is there ever going to be a reconciliation of true human
knowledge through science and true human acceptance of knowledge?

MANN: Well, as you heard Chip sort of allude to, there is a bit of a
schism that I think is emerging within the Republican Party. There are
those like the chairman of the House Science Committee, Lamar Smith, a
Texan who denies that climate change exists. And he`s the chair of the
House Science Committee. I sometimes joke that maybe we need to rename it
the "House Anti-Science Committee" given its current stance on issues like
climate change and evolution.

But there are those scientists who -- there are those politician who
completely dismiss the underlying science but then you have more
enlightened Republicans like the former House Committee chair, Sherwood
Boehlert, who was an old school pro-science Republican.

And you have folks like Bob Inglis, South Carolina --

MATTHEWS: Yes, he`s gone.

MANN: -- a Republican -- a conservative Republican. Well, he was
primaried. He was primaried by the Koch brothers because he expressed an
enlightened view about climate change.

MATTHEWS: Let me ask you a fair question, wide open, I won`t challenge
you, Chip. Is the Republican Party leaning towards science or against it?

SALTSMAN: Well, I would hope to say we always lean towards science. But
on this case, like I said, there`s many Republicans all across the board on
this particular issue. You know, like I said, I`m not a scientist, so I
don`t read the book like our scientist on the thing does. But I really do
believe that in the Republican Party, there is a lot that believe -- we
know that we`ve got so many people living on this planet using limited
resources, we`ve got to do what we can.

MATTHEWS: I just hope people don`t think that ignorance is bliss, that if
you stay confused and you stay in the situation and keep saying, it`s in
dispute, and you very . Full keep saying it`s in dispute, and you very
carefully don`t read the journals, very carefully don`t accept the science,
you`re always at a safe position of saying, well, I always thought it was
in dispute so I guess I`m not really to blame, I think you are to blame.

But not you, Chip, because you`re a political strategist. Anyway, Chip
Saltsman and Michael Mann --

MATTHEWS: I do worry about Huckabee though. Anyway, thank you, Professor,
for coming on, from the great university, I love Penn State.

And we`ll be right back after this with actor Eric Bana. He is coming on
to talk about the cameras that are on all of us, especially in the big
cities.

(COMMERCIAL BREAK)

MATTHEWS: Well, please remember starting next Monday HARDBALL will be on
exclusively, I like to say it that way, at 7:00 Eastern time. I know it
means adjusting your evening ritual. I`m adjusting mine. But I`m asking
you to make the move with me. Come with me, 7:00 Eastern. We`re going to
be on with HARDBALL forever I hope. Back after this.

(COMMERCIAL BREAK)

MATTHEWS: We`re back. The Boston bombing this spring sparked a debate in
this country about the growing presence of surveillance cameras, you know,
all over our cities, the grainy security photos. There one is. And video
helped identify the two bombers but, here`s the but, civil libertarians
warn it comes at a price: our shrinking personal privacy.

And that`s the setting for the new thriller "Closed Circuit," a film that
delves into the dark milieu of spies run amok and the paranoia of living in
a state of constant surveillance after a terrorist bombing in central
London. Two lawyers assigned to defend the lone surviving suspect find
themselves against what looks like a massive conspiracy. Let`s watch.

How are you? And I know you spent months shooting this film. And it must
have gotten to you, the idea, my God, it used to be with Mohamed Atta, we
caught him too late, he had blown up the World Trade Center, and he was one
of those people on the planes that -- with the terrorists.

And yet afterwards we saw him at the ATM getting some money out. We saw
him at Walmart. And now we -- there he is right there. And then later
when we caught the Boston bomber suspects, we see them, it just turns out
that local stores have been -- like this, were just doing surveillance
cameras and you can accumulate all together and you almost can follow a
person during the day.

ERIC BANA, ACTOR: Yes, it`s amazing how much of someone`s life you can
piece together with just small snippets of random pieces of closed circuit
TV footage. We had a big murder case in Australia last year where the
accused was arrested based on very, very low quality, grainy footage inside
a clothing store, because we don`t have a lot of it in Melbourne,
Australia. And they were able to arrest the accused based on that.

MATTHEWS: And they put him away on that?

BANA: They haven`t put him away yet but it was a very fast-breaking case
that the police were able to recognize the accused through the window.

So there is no doubt there is a place for it but it is the speed at which
these liberties are being taken away that I guess calls it into question.

MATTHEWS: Well, so many of us in America went to high school and read
"1984," George Orwell. We all know about that where you have a state where
the TV set faces you and is watching you all the time. We`re getting
there.

BANA: Yes. And it is funny, the general public is kind of catching up
with this to a degree because the number of these cameras that are out
there, having made the film, it makes you more aware --

BANA: And that`s the other thing. Once you start to look out for them,
you do see them everywhere. It`s not just that they`re on government
property. You go to a restaurant and you see them inside a restaurant.
You start looking out for them and you notice that they`re everywhere.

BANA: Well, if we`re all behaving ourselves, presumably we`re all OK. I
mean, I think I would fall asleep watching footage of me after a while.

MATTHEWS: Well, why would a restaurant have cameras on everybody? Nobody
is stealing -- to see if you`re stealing a fork or what?

BANA: I don`t know. Well, I guess if someone is, you know, reaching into
the till. I mean, in Australia we have a problem with binge drinking and
so forth in the city. And when you see the amount of behavior that --

(CROSSTALK)

MATTHEWS: Can you do a British accent right now?

BANA: A British accent, well, it depends on where he is from, actually. I
mean, my guy doesn`t sound exactly like that.

MATTHEWS: You guys are amazing, you can do that.

So, seriously, though, the American people, I think, are very glad we
caught the bombers. We`re very glad the Boston PD -- Police Department
were able to do it quickly. You know, we`re happy.

BANA: Yes.

MATTHEWS: So what`s the downside?

BANA: Well, I guess the downside is, how can we control that information
being used in the future? What happens when facial recognition technology
comes in and they are able to basically profile everything we do and where
we go and what kind of purchases we make?

BANA: It does. It delves right into that. And we deal with a cover-up by
the British government. And it is just a classic adult thriller that we
had no idea would become so timely.

MATTHEWS: Oh, it`s going to be great. I can`t wait. I`ve seen it in the
trailers around Washington. I can`t wait to see it. The name of the movie
is -- we don`t call them films here. The name of the movie is "Closed
Circuit." And we have got the star with us, Eric Bana.

Thanks for coming in and telling us about it.

BANA: Thanks very much, Chris.

MATTHEWS: Because it is something we talk about here all the time,
especially with the NSA.

And we`ll be right back after this.

(COMMERCIAL BREAK)

MATTHEWS: "Let Me Finish" tonight with this. I want to repeat the
personal appeal made by me here last night. As I said, beginning a week
from yesterday, that`s next Monday, HARDBALL, this pioneering show of news,
analysis, and, yes, passion, will air at 7:00 p.m. exclusively. To join me
in cutting through the issues of the day, this program will be on just once
each evening at 7:00 p.m. Eastern.

I realize that we all have our habits, our evening rituals, and there is no
better time of day, I think you`ll agree, than early evening when you
settle down and enjoy the change of pace. I`m asking that you make the
adjustment and move with me, if you normally watch at 5:00, to watch me
with the same faithfulness at 7:00 p.m.

It is the only way we can stick together, which is my chief professional
and political purpose in finding sanity and truth and a common-sense, often
progressive future for this country we love. So start watching as soon as
you can. To paraphrase a great and dearly missed newsman, if it is 7:00
p.m., it is HARDBALL.

And that`s HARDBALL for now. Thanks for being with us. "POLITICS NATION
WITH AL SHARPTON" starts right now.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY
BE UPDATED.
END

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